Have a question? Get answers. Email us: askpete@petetheplanner.com
Maybe things around here are slipping back to “normal.” Pete and Damian have the pleasure of answering some incredibly hard questions from our listeners.
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No time to listen? BUMMER. Here’s some of what happened:
Show Notes:
Mailbag Question 1:
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- “We’ve got a 27-year old adult daughter, who lives 15 hours away. She’s soon moving in with a friend with plans to hire a moving company. Her car is also breaking down. She has $2500 in her account, but says she doesn’t have enough to move, pay the damage deposit, get her vehicle fixed, and live. She spends without thinking of the future, makes me feel so stressed out. How can I help her help herself and care about money?“
- Maybe better said: “How do you help and adult child make wise decisions going forward so they can be more stable in their life and do it without you in the future?”
- Pete: Sometimes if you swoop in and “rescue” someone, but you have not fixed the underlying issue, things get worse.
- Dame: If I were this woman, the correct answer would be to help as little as possible.
- Avoid the slightly empty but well-meaning, “let us know what we can do to help.”
- “We’ve got a 27-year old adult daughter, who lives 15 hours away. She’s soon moving in with a friend with plans to hire a moving company. Her car is also breaking down. She has $2500 in her account, but says she doesn’t have enough to move, pay the damage deposit, get her vehicle fixed, and live. She spends without thinking of the future, makes me feel so stressed out. How can I help her help herself and care about money?“
Mailbag Question 2:
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- “I am 72 years old and healthy. Before quarantine, between Airbnb, a university tech job, and SSI, I was grossing $125K per year. Because of the pandemic, I took a buyout of about $53K before taxes from the university, and closed the Airbnb. I owe about $200,000 on my house – appraised at $600,000 – at 4.37% with 10-15 years to go. $125,000 HELOC with balance of $0. SSI is about $2,100/month, 403(b) at $410,000. Annual budget is about $55,000, so it doesn’t all add up. Should I refinance? How can I remain in my house and get it paid off?“
- Refinancing is the first answer. The interest rate is really high compared to current rates. Saving that $300 per month would be helpful. But there are some deeper issues here:
- He needs $4500 per month to live. SSI brings in $2,100, and he could get another $1,000 from the 403(b), leaving a gap of $1,400. Add $300 from refinancing the mortgage. Post-pandemic, the Airbnb could come back.
- He doesn’t need to dip into the HELOC, but maybe could find some part-time income, as the tech field is generally ripe with opportunity.
- “I am 72 years old and healthy. Before quarantine, between Airbnb, a university tech job, and SSI, I was grossing $125K per year. Because of the pandemic, I took a buyout of about $53K before taxes from the university, and closed the Airbnb. I owe about $200,000 on my house – appraised at $600,000 – at 4.37% with 10-15 years to go. $125,000 HELOC with balance of $0. SSI is about $2,100/month, 403(b) at $410,000. Annual budget is about $55,000, so it doesn’t all add up. Should I refinance? How can I remain in my house and get it paid off?“
There’s more in the show! Listen, listen, listen!
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Peter Dunn a.k.a. Pete the Planner® is an award-winning financial mind and a former comedian. He’s a USA TODAY columnist, author of ten books, and is the host of the popular radio show and podcast, The Pete the Planner Show. Pete is considered one of the foremost experts on financial wellness in the world, but he’s just as likely to talk your ear off about bass fishing.